Major news: ByteDance has officially passed $4 billion in annual recurring revenue from its LLMs, according to the South China Morning Post. This is especially significant because it would make ByteDance the biggest publicly known AI business in China.
Annual recurring revenue estimates subscription income over a 12 month period using current monthly earnings. Sources told South China Morning Post that ByteDance reached $4 billion this month 鈥� which is well past its domestic rivals.
The company, which owns TikTok and Douyin, has spent the past few months turning more of its AI products into paid services for businesses and consumers, with Doubao becoming one of its biggest sources of AI income.
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How Much Further Is ByteDance Compared To Its Competitors?
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Let鈥檚 give this some context: Zhipu, known internationally as Z.ai, recorded annual recurring revenue of $1 billion in July. Reports also said DeepSeek was close to $500 million, and Bloomberg reported Moonshot AI reached $300 million in June, as the publication mentioned.
It also mentioned that Alibaba announced in May that annual recurring revenue from its AI models and applications would pass 10 billion yuan (about $1.5 billion), during the second quarter and come to three times that amount before the end of the year.
Chinese AI companies aren鈥檛 quite making the numbers the biggest American businesses are yet. Estimates from data platform TickerTrends value Anthropic鈥檚 annual recurring revenue at $74.1 billion and OpenAI鈥檚 at $41.3 billion.
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What Is Bringing In AI Revenue?
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ByteDance introduced optional paid subscriptions for the Doubao chatbot in early May. Monthly prices range from 68 yuan to 500 yuan, and customers can also choose a lower priced annual subscription.
According to Aicpb.com, Doubao lost about 6.1 million monthly active users after the subscriptions were announced. Even after that, it remained China鈥檚 most popular AI app with 330 million users.
Impact Newswire said Doubao and enterprise AI services sold through Volcano Engine have become important sources of AI income for the company.
The publication also said ByteDance has invested in foundation models, as well as cloud computing, AI chips and video generation tech as it develops more AI products for businesses.
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What Else Is Changing With Other ByteDance Platforms?
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On semi-related note, ByteDance has reorganised its workplace collaboration platform Lark, known as Feishu in China, as it brings more of its AI products into one business structure.
According to an internal memo seen by the South China Morning Post, Lark鈥檚 product team will join the team responsible for the Doubao AI chatbot. Zhao Qi, who previously led Doubao, will oversee the enlarged product division, and Lark Chief Executive David Xie Xin will report to him.
Lark鈥檚 sales, marketing and customer service teams will join Volcano Engine, where a new department will handle sales and customer support for the company鈥檚 model as a service, software as a service and cloud products. Volcano Engine President Tan Dai will lead that department, and Lark鈥檚 development and infrastructure team will become part of Flow, ByteDance鈥檚 AI applications division.
The reorganisation, in ByteDance鈥檚 words, will build 鈥渟tronger AI product competitiveness and customer service capabilities.鈥�
The company is clearly prioritising AI, and all of this explains how it is surpassing its local rivals. It鈥檇 be interesting to see how long it鈥檇 take the company to start operating at the level of its Americal competitors.
